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5#
发表于 2013-4-8 22:31
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sparty419,
I wish I can tell u whether there is a direct contradiction or not, but here’s my take:
–Generally CFA materials try to state that alternative investment (including commodity) is a good diversification tool to the typical investment (stock & bond) in a broad sense because their return/risk are “weakly correlated”.
–There are lots of flexibilities in the whole thing. First, stock and bond returnes may not correlate with each other. e.g. In a downturn, stocks perform poorly. However, fixed-rate bonds in your portfolio may perform well since the Fed continually cuts interest rate. Unless there is a credit crisis, most avg. and high quality bonds should do good in a downturn. This is probably the thing that threw you off because CFAI wraps the 2 separate asset classes as one here.
–Commodity price are highly correlated with inflation. However, stocks performs well with low/moderate inflation but poorly in high inflation.
–Correlation is a matter of “degree” in some circumstance. Zero and negative correlations are good for diversification. In addition, “low/weak” correlation can be used for diversification as well. In a upturn, commodity price usually goes up so does the equity price, but it may not be in a highly correlated way in every instance.
CFAI just tries to say that commodity can be a good diversification tool for everyone’s portfolio usually containing a mix of stocks and bonds. If I got anything wrong, please let me know. |
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